Toyota has been in the country for 13 long years, but what it wants now is a youthful image. Recognising that the mass market is where the volumes are, which in India translates into the younger generation, the Japanese auto giant is planning to give its hatchback, Etios Liva, the push it needs to get popular in the segment.
In the first step to achieving greater volumes from the small car, Toyota hopes to ramp up total sales to about 3.5 lakh units by 2015, nearly double the target of 1.8 lakh units for this year. Plans to increase capacity to 3.10 lakh units per year by March 2014 are already on track.
?We are not yet fully in their (youth) buying list. It will take us at least one more year. I think by the end of next year we will be deep in the minds of people in that segment,? hopes Sandeep Singh, deputy managing director (marketing) at Toyota Kirloskar Motor. ?If you look at the response, we are quite happy. Orders are more than what we had planned for. The only thing is that word of mouth should now spread.?
Since Toyota claims a market share of only 6.3% in India?s passenger car industry since it entered India, this is not going to be easy. The mass market car segment is dominated by Maruti Suzuki, Hyundai Motor India and Tata Motors. And, the Etios Liva is pitted against other entrants in the B segment, including Ford Figo, General Motors? Beat, Volkswagen Polo, Honda Brio, Nissan Micra, Renault Pulse and Skoda Fabia.
Toyota also plans to enter 60 small cities in the next one year and add at least 50 dealerships to reach a total of 225 sales and service outlets by March to increase sales.
What could help the company further is some smart marketing strategy, in the shape of 23-year-old Indian cricketer Virat Kohli in this case, who has been roped in as brand ambassador. Products like Corolla and Innova are not perceived to be ?youthful?, something that has defined Toyota?s innings in India so far.
?Everybody globally thought that India will climb up the value chain. But the fundamentals are not likely to change. Ford realised it, and so did Chevrolet and Honda,? says VG Ramakrishnan, vice-president, automotive and transportation practice, Frost & Sullivan.
However, by Toyota?s own admission, the push into the mass market segment with Etios Liva will require at least two years to gain the kind of customer confidence its best selling models like Corolla and Innova enjoy.
Analysts reckon a key challenge will also be to follow up with other models, considering that the companies with higher market share in the B segment also offer variety. ?Today, the customer is bothered about value for money. The question is not whether you have come late or early; the key question is what you are offering to customers,? says Abdul Majeed, partner, PriceWaterhouse, who leads the auto practice.